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Berge & Berge, LLP Blog

Thursday, April 19, 2018

The Importance of Special Needs Planning in California

Q: Will giving a special needs person money jeopardize their government benefits?

Life can be challenging for those who know and love a special needs child or adult. The emotional and financial burden on the caretakers of these special people is often substantial. In addition to struggling to provide for their needs today, many parents of special needs children and adults worry what will happen to their children after they die.

That's why it's important for parents and grandparents to seek advice from a skilled California special needs planning attorney as soon as possible. There is planning to do for living right now as well as measures to put in place in an estate plan.

This not only helps parents with their unique estate planning needs, but also ensures that they don't make any of the many common mistakes that could jeopardize their special needs child's (or grandchild's) state or federal government benefits.

Many of the government benefits programs-- like the federal government’s Supplemental Security Income (“SSI”) -- put severe financial restrictions on the amount of assets which the special-needs person may own in their own name in order to qualify for or continue to receive government benefits. The number is as low as $2,000. Creating a bank account in the special-needs person's name or leaving the money outright in a last will and testament could be disastrous to their eligibility for benefits.

But that doesn't mean the parents (and grandparents or others) can't funnel money to special-needs people either throughout their lifetimes or upon their deaths. It just takes specialized planning, which often includes a special needs trust. In a special needs trust, funds placed in the trust would be managed by a third-party for the benefit of the special-needs person, rather than being given to the person outright.

There are also ABLE bank accounts—short for “Achieving Better Life Experience” accounts-- which families of special needs people (who were diagnosed as disabled prior to age 26) can contribute up to $15,000 per year (up to a maximum of $100,000 total) before government benefits will be impacted. The funds can be used for a wide variety of expenses that benefit the quality of life of the special-needs person.

These and other planning options available as well, so seeing a special needs planning attorney for more details can help you provide a better quality of life for your loved one with special needs now and after you are gone, prevent mistakes that could jeopardize their benefits, and possibly relieve the burden of caretaking on yourself and others once you are gone.

If there is a special needs child or adult in your life, and you need assistance with an initial estate plan or need to modify an existing estate plan or have any other questions regarding special-needs planning, the Law Offices of Berge & Berge can help you. Contact us today to schedule a consultation.

From our offices in San Jose, California, we've been proudly serving the South Bay area in all matters of trust and estate planning for over 23 years.


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